Plans to extract data from exchanges will enable authorities to audit traders themselves, should questions arise over tax payments.
Australia’s tax agency, the Australian Tax Office (ATO), will seek to contact cryptocurrency traders personally about tax issues as part of a new data collection scheme, officials confirmed in a statement on April 30.
The ATO, which is working in conjunction with the Australian Securities and Investment Commission (ASIC) and the Australian Transaction Reports and Analysis Centre (AUSTRAC), says it will demand information on operations from local cryptocurrency exchanges.
That data will then be used to contact traders involved, who will get a minimum of 28 days to explain their operations as they pertain to capital gains tax reporting.
“The ATO is also working in a joint international effort as part of the Joint Chiefs of Global Tax Enforcement (J5), aimed at investigating cryptocurrency-related tax evasion and money laundering,” ATO deputy commissioner Will Day commented in the statement.
The move underscores the continuing battle Australian authorities are attempting to fight to keep the domestic cryptocurrency industry in check.
According to Day, however, the latest efforts are in support of traders and aim to assist them in navigating their tax obligations.
“We want to help taxpayers to get it right and ensure they are paying the correct amount of tax,” he added.
The ATO appears to maintain only vague figures about the number of active traders under its jurisdiction, the number lying anywhere between 500,000 and 1 million.
Last month, AUSTRAC shut down two exchanges as part of a crackdown on drug trafficking.